"An assessment where an individual's performance is compared to a specific learning objective or performance standard and not to the performance of other students. Criterion-referenced assessment tells us how well students are performing on specific goals or standards rather than just telling how their performance compares to a norm group of students nationally or locally. In criterion-referenced assessments, it is possible that none, or all, of the examinees will reach a particular goal or performance standard."
Wildemuth (1985) adds that a criterion-referenced test is useful in helping teachers identify and plan remedial instruction for students who need help in specific areas.